BNZ has joined ASB and ANZ in moving to introduce loan value restrictions on investor lending, ahead of new Reserve Bank rules due in March.
BNZ announced today it was returning to its pre-Covid-19 home lending loan-to-value (LVR) ratio settings for property investors.
This means that from the 7th of December 2020, BNZ will require a minimum 30 per cent deposit from residential property investors.
That means all four major banks now have their investor lending policies back to where they were pre-Covid, when Reserve Bank restrictions were still in place.
On November 11 the Reserve Bank said it would consult on bringing loan to value ratio restrictions back from March 1.
LVRs restrict how much banks can lend to low-deposit borrowers.
Under the previous LVR rules banks were only able to do 5 per cent of new lending to investors with a deposit of under 30 per cent.
Westpac has said it never changed its lending settings and they remained in line with previous LVR rules.
"We have remained open for business across all segments and have grown our support for housing, agri and business customers over the past year," a spokesperson said.
Booming house prices in the past two months have put the Government and Reserve Bank under pressure to act, with many blaming low interest rates for the latest surge.
Earlier today Finance Minister Grant Robertson revealed he had written to the Reserve Bank asking it to consider house prices more closely in its monetary policy remit.
LVRs and fall under the Reserve Bank's financial stability remit.
Tomorrow the RBNZ will deliver its latest Financial Stability Report which will include an assessment of how much risk it sees in current levels of mortgage debt.